2017.11.2108:01:00UTC+00Malaysia Economic Growth Likely To Remain Robust In 2018

Malaysia's economy should continue to grow at a decent pace over the next year, underpinned by robust exports and investment, economists at Capital Economics said.

Gross domestic product advanced 6.2 percent year-over-year in the third quarter, faster than the 5.8 percent growth in the second quarter, official data showed on November 17.

Moreover, the economy expanded at its fastest pace in three years.

The breakdown of the data showed that private consumption, investment, government spending and net exports all advanced at a faster pace in the third quarter.

Among them, investment recorded the sharpest improvement, with growth rising to 6.7 percent from 4.1 percent.

Looking ahead, exports are likely to remain a key driver for the coming quarters, economists said.

Besides this, Malaysia's economy should continue to benefit from rising investment, they added.

However, headwinds facing the economy are also growing, Capital Economics cautioned.

"For one, with inflationary pressures rising, we suspect that Bank Negara Malaysia will start to tighten monetary policy soon, possibly as early as January, economists noted.

Furthermore, high levels of household debt means that consumer spending is unlikely to maintain its current pace. "The upshot is that growth should remain robust, even if it is unlikely to maintain its current pace," economists said.